BILL ANALYSIS Ó SB 1263 Page 1 Date of Hearing: June 28, 2016 ASSEMBLY COMMITTEE ON WATER, PARKS, AND WILDLIFE Marc Levine, Chair SB 1263 (Wieckowski) - As Amended June 20, 2016 SENATE VOTE: 21-13 SUBJECT: Public water system: permits SUMMARY: Requires a person submitting an application for a permit for a proposed new public water system to first submit a preliminary technical report, with specified information, to the State Water Resources Control Board (SWRCB) at least six months before initiating construction of any water-related development. Authorizes the SWRCB to deny a permit for a new public water system under specified conditions. Specifically, this bill: 1)Establishes a requirement that prior to a person submitting an application for a permit for a proposed new public water system to first submit a technical report to the SWRCB at least six months before construction. 2)Requires specific information to be included in the technical report including an analysis of other public water systems within three miles of the proposed new public water system and the ability to connect to or utilize the resources from those public water systems. Additionally, requires the technical SB 1263 Page 2 report to include an analysis of all water supply for the proposed new public water system and the ability to meet 20-year water demand under a variety of hydrologic conditions. 3)Authorizes the SWRCB to direct the applicant to engage in negotiations to receive services from existing water systems. 4)Makes specified exemptions from the requirement an applicant submit a technical report. 5)Subjects the ability of a local primacy agency to issue a permit for a public water system to SWRCB oversight. 6)Prohibits a city or county from issuing a building permit for new residential development where a water supply source is water transported by a water hauler, bottled water, a water-vending machine or a retail water facility. EXISTING LAW: 1)Establishes the policy of the state that every human being has the right to safe, clean, affordable, and accessible water adequate for human consumption, cooking and sanitary purposes. 2)Vests the SWRCB with all of the authority, duties, powers, purposes, functions and responsibilities, to enforce the State Drinking Water Act (SDWA). 3)Prohibits any person from operating a public water system unless he or she first submits an application to the State Water Board and receives a permit. SB 1263 Page 3 4)Requires the SWRCB, upon determination that an application for a public water system is complete, to make a thorough investigation of the proposed or existing plant, works, system, or water supply, and all other circumstances and conditions that it deems material, including any financial assurance information. 5)Requires the State Water Board, following completion of its required investigation, to issue or deny the permit for a public water system. Authorizes the State Water Board to impose permit conditions, requirements for system improvements, and time schedules as it deems necessary, to ensure a reliable and adequate supply of water at all times that is pure, wholesome, potable, and does not endanger the health of consumers. 6)Requires any person who owns a public water system to ensure that the system complies with drinking water standards. 7)Permits the SWRCB to delegate drinking water quality enforcement to a "local primacy agency" as defined. FISCAL EFFECT: Unknown. COMMENTS: Requires a person submitting an application for a permit for a proposed new public water system to first submit a preliminary technical report, with specified information, to the State Water Resources Control Board (SWRCB) at least six months before initiating construction of any water-related development. Authorizes the SWRCB to deny a permit for a new public water system under specified conditions. 1)Author's statement: When Californians turn on their water at SB 1263 Page 4 the kitchen sink, they assume that it's safe, quality drinking water that meets all the government standards. But in many communities, especially those connected to the small public water systems, the high quality of drinking water should not be taken for granted. California has more than 7,600 public water systems and these smaller systems can be challenged over the long term by their lack of technical, financial and managerial abilities. This bill gives the State Water Board a stronger role in ensuring such systems are not approved if they are unnecessary. SB 1263 will limit the proliferation of new, unsustainable public water systems by creating a strengthened review process for new system applications. With its requirements for a preliminary technical report, SB 1263 will strengthen the public water system permitting process by systematizing and making more transparent the analytical due diligence that developers typically do. 2)Background: California has a challenge providing safe drinking water to all of its residents. The SWRCB is responsible for the state's drinking water program and estimates that 500 communities rely on public water systems that do not meet drinking water standards. We do not know exactly how many Californians lack access to safe drinking water on a daily basis, but it is on the order of millions of people. Drinking water contamination disproportionally affects disadvantaged communities that rely on groundwater as their drinking water source. Many small communities do not have the technical, managerial, or financial capability to operate what can be complex drinking water systems. SB 1263 Page 5 The SWRCB has primary enforcement authority to enforce federal and state safe drinking water acts, and is responsible for the regulatory oversight of about 8,000 public water systems throughout the state. Enforcement authority for approximately 5,500 small water systems, defined as systems with under 200 service connections, has been delegated to local health officers through local primacy agreements. The SWRCB primary authority lies in approving or disapproving a permit for a new public drinking water system. Once a drinking water system is in place the actions that can be taken to address problems with the system become more limited. Under existing law the evaluation for approval of a permit is focused on the immediate ability of a proposed new public drinking water system to meet standards. Existing law is not clear on the authority of the SWRCB to evaluate the ability of a proposed new public drinking water system to meet drinking water standards prospectively. This bill would allow the SWRCB to exercise greater evaluation over a proposed new public water system. The submission of the required information in the technical report six months prior to the submission of a permit application will give the SWRCB the information necessary to make an evaluation of the ability of the proposed new public water system's water supplies to meet drinking water standards for the foreseeable future. The bill also gives the SWRCB the authority to deny a permit if a determination is made that the proposed new system will not be sustainable into the future. 3)Suggested Technical Amendments: Committee staff suggests the following technical amendments. SB 1263 Page 6 a) On page 6 lines 9-31 the bolded italicized language should be added as follows: (1) If an existing public water system has not already sought annexation of the service area of a proposed new public water system from the local agency formation commission or the applicant has not already sought an extension of services agreement from an existing public water system, direct the applicant to undertake additional discussion and negotiation with any existing public water system meeting the requirements of paragraph (1) of subdivision (c) that the state board determines has the technical, managerial, and financial capacity to provide an adequate and reliable supply of domestic water to the service area of the proposed new public water system. The state board shall not direct the applicant to undertake additional discussion and negotiation if documentation submitted to the state board demonstrates that additional discussion and negotiation is unlikely to be successful, including, but not limited to, documentation that a local agency formation commission has already denied the application for an extension of service or annexation, or that the existing public water system has declined to apply to the local agency formation commission for approval of an extension of services to, or annexation of, the service area of the proposed new public water system. b) On page 6 lines 37-39 the bolded italicized language should be added as follows: (f) (1) An applicant shall comply with the state board's directives as assigned in and consistent with subdivision (e) before submitting an application for a permit for a proposed new public water system under this chapter. c) On page 8 in lines 1-13 the bolded italicized language should be added as follows: 3) The state board shall promptly acknowledge receipt of a written notice described in paragraph (2). The state board SB 1263 Page 7 shall have 30 days from the acknowledgment of receipt of the written notice to issue a written notice to the applicant that compliance with the requirements of this section is necessary and that an application for a permit of a new public water system under this chapter is not complete until the applicant has complied with the requirements of this section. A determination by the state board that compliance with the requirements of this section is necessary shall be final and is not subject to review by the state board. A determination by the state board pursuant to this subdivision is not considered a project subject to Division 13 (commencing with Section 21000) of the Public Resources Code. 1)Prior and Related Legislation: a) SB 552 (Wolk), would authorize the SWRCB to contract with an administrator to provide administrative and managerial services in specified disadvantaged communities. To be heard in this committee on June 28, 2016. b) SB 88 (Committee on Budget), Chapter 27, Statues of 2015, authorizes the SWRCB to order water system consolidation or extension of services. 1)Supporting Arguments: This bill will place reasonable standards on new small public water systems throughout the state by enhancing the permitting procedure required. This bill specifically includes a discussion of existing nearby water systems, proposed sources of domestic water, estimated costs of development and long-term operation and maintenance relative to other options. This will help strengthen the permitting process and limit the proliferation of small, unsustainable systems. This will be an important tool for SB 1263 Page 8 providing access to safe drinking water. REGISTERED SUPPORT / OPPOSITION: Support California League of Conservation Voters Clean Water Action Community Water Center East Bay Municipal Utility District Environment California Environmental Working Group Leadership Counsel for Justice and Accountability Lutheran Office of Public Policy - California Natural Resources Defense Council Sierra Club SB 1263 Page 9 Tri-City Ecology Center Union of Concerned Scientists Opposition None on File Analysis Prepared by:Ryan Ojakian / W., P., & W. / (916) 319-2096